MPs and business groups have called for the extension of the UK government’s support...read more
The Top Franchise Awards ceremony was followed by a Q & A with our judges and experts: Kendall Braddock, Franchise Director of HSBC Bank plc, franchise law expert Amy Leite, Associate Solicitor at Aquabridge Law, Griselda Togobo, Managing Director of Forward Ladies who are partners for the Awards, Sean McKeon, franchise development manager of Kumon Educational UK, Louise Young, Brand and Communications Manager at Kumon Educational UK, and Gillian Nissim, founder of Workingmums.co.uk. The questions covered everything from maternity leave to communicating with franchisees. The following is a selection of some of the questions and answers.
Q: I would be interested in how to support franchisees through maternity. How could this be part of what we offer to people interested in becoming franchisees?
Amy Leite: Unfortunately, this is not commonly something which is done by franchisors, but I hope the tide will turn in this respect at least in the more family-friendly franchises. You would need to consider what support you would like to give and practically how it can be achieved as the franchise network grows. If you really do want to offer an amount of support to franchisees through maternity that could be reflected in the terms of the franchise agreement you have with the franchisees (i.e. what you will do to help them), but it would need to be carefully considered and you would need to ensure you could comply with the support you say you will give them within the terms of the agreement. If you reflect this support in your franchise agreement it would be something you could advertise as offering to people who are thinking about becoming franchisees.
Q: Does anyone have any advice on social media as a way to communicate with franchisees?
Louise Young: Unless it’s a closed Facebook group, I would use a different platform to communicate with franchisees. Email groups work well and ensure the same message goes to all. Consider setting up a regular weekly update to provide them with regular and engaging content that’s relevant to them. Provide networking events, training days and awards events to ensure you engage with them frequently. Set up a web platform to host information and downloads for them.
Q: With Brexit, is this a good time to think about expanding abroad. Any legal matters I need to think about and any advice on financing this?
Kendall Braddock: I will respond to the financing element of the query. I would recommend that you enter into discussions with banks that specialise in franchise funding which are domiciled in the country that you are expanding to. To try and fund an overseas business from here can add complexities to the lending which can be avoided….it’s best to try and not seek lending in the UK as banks look at this as cross border funding which has its problems.
Q: How can I ensure that I protect my brand moving forward?
Louise Young: Clear brand guidelines and, depending on the size of your franchise, you may decide to design all materials your franchisees use. Ensure you provide ad templates, editorial templates and copy templates so that all written communication about your brand is consistent. Social media monitoring is also essential to protect your brand and you need to respond swiftly and positively to all comments you receive. Train your franchisees in the skills they make be lacking in terms of communicating your brand values.
Q: How can I best protect myself from choosing bad franchisees?
Amy Leite: The franchisee recruitment process should be as much about you ensuring that the franchisees are suitable for your brand and what your franchise model is trying to achieve as much as it is about them seeing if the franchise meets their needs. You should try and be selective in who you allow to become a franchisee. I am aware that some franchisors have quite a rigorous process of applying to be a franchisee and some even have a questionnaire put in place that can work out whether the franchisee is what you are looking for by their answers. However, you always need to bear in mind prospective franchisees will be on their best behaviour during initial processes so it may be hard to weed out problematic ones. I would look out for people who ask lots of questions and in particular really want to know how the business works and show initiative rather than those who don’t really have any questions/seem to show much initiative – it doesn’t mean they will be bad franchisees, but they may be hard work and expect a lot more to be done by you than the self starters (but they also rarely come without problems!) It’s about fine tuning a way of weeding out who you think will really fit and there are lots of avenues to achieving that. Remember there is also a lot to be said for gut feelings!
Q: I am looking for marketing inspiration. The Little Squigglers Franchise that I am part of is not very well known in my area and I need to change this. I am very active on Facebook, have had a local paper advert which was very costly and only attracted one call and have sent out many leaflets to local schools etc. I am looking to set up in a new area and am hoping for some marketing tips.
Griselda Tobogo: You need to have several approaches/channels for marketing your business. Facebook is just one of the ways. You have social media – Instagram, Twitter etc and then speaking and PR as well.
Louise Young: The key is planning and taking a long-term approach. I would always recommend clearly defining your target audience and then researching where your audience are currently looking for child-centred activity. Google your competitors and see where they advertise locally. It’s likely you will need to ensure you have a range of consistent activity in place before you start to see the benefit in terms of enquiries. Update all local free online listings sites first, claim your Google My Business listing, run leafleting in your target locations every three months, post share-worthy content on Facebook, post posts with spend where relevant, then consider sponsoring school events, sharing stories through editorial content and increase your local visibility at your venue – is there space for road-facing banners or signage? Co-promote with other child friendly business and join local networking groups. Ensure you handle all enquiries promptly and encourage parents to give you reviews through Google. All of this will begin to help!
Q: I own Talking Tots Southend, Chelmsford & Maldon and we run classes for local pre-schoolers to support speech, communication and social skill development to help prepare for pre-school and ultimately big school. As I seek to expand across Essex and beyond I’d like to ask about sub-franchising as an alternative to me taking on more class leaders (the further away the classes the more challenging they are to manage and market)?
Amy Leite: You would need to check that the franchise agreement allows you to expand in this way. Often franchisees are not allowed to sub-franchise so your expansion would have to be done in accordance with the terms of the agreement to avoid you being in breach. That may mean, as you say, taking on more class leaders which in order to make that easier to manage may mean you have to appoint other staff/managers to oversee them which could free up more time for marketing.
Sean McKeon: I am answering this question on the basis that ‘sub-franchising’ meaning franchising. A key factor will be how you train any prospective new franchisees. Maintaining quality is imperative and therefore any franchisee you recruit will need to be fully conversant with your programmes, operating procedures, communications strategies and compliance obligations. You will need to create an Operations Manual that will offer a franchisee step-by step instructions with regard to all aspects of the business. This can then be supported and regulated through your Franchise Agreement. I would recommend the British Franchise Association as a first port of call and also a Solicitor with knowledge of the franchise industry.
Kendall Braddock: Banks will always have to undertake assessment on each request for finance they receive so there are things you can do to help you get a speedy decision. Always approach the bank with a completed business plan. This should incorporate three-year financial forecasts and Cash Flow Forecasts and a narrative outlining your requirements and details of the business you are looking to start. It’s important to demonstrate that you’ve done your due diligence and that the opportunity for your products and services can support the level of borrowings you require. It’s always best to approach the franchise units of the banks who have the expertise to guide you to the appropriate individual in the bank – most of the large banks have dedicated teams. Typically a decision should be forthcoming within seven days of meeting the bank and the funds made available within 5-10 weeks. This period may appear long, but the post approval checks and account opening process for business funding are thorough.
Q: We are looking to expand our Franchise to the UAE, USA and Australia. Where can I find legal requirements for starting in these countries?
Amy Leite: If you are looking at international franchising you need to take advice from a solicitor who has experience in international franchising as there are different ways of taking a franchise model abroad and rules, regulations and considerations will be different for countries outside of Europe. Commonly franchisors who do take models abroad either do it by direct franchising to franchisees within those countries or by appointing a master franchisee (who acts like the franchisor) for that particular country. There are pros and cons of both. It is not only different laws that need to considered but cultural differences, different business practices, tax and how revenue can be repatriated. It is a big step, but done properly with all the correct advice it can be very successful.
Griselda Togobo: Have you contacted your local department for trade? They have several initiatives and funding to help UK businesses export outside the UK.
Q: How do we recruit new Franchisees on a limited advertising budget?
Sean McKeon: Existing network/client base is your first port of call. Do they know where you are looking to expand? Word of mouth can yield zero cost franchisees. If needed, a referral scheme can prove a highly efficient and low cost means of attracting franchisees. Within new territories, consider attending breakfast clubs and local networking events to raise awareness of the opportunity.
Louise Young: This depends largely on the profile of your ideal franchisee. The best low-cost option could be Facebook if this is where you are likely to find your ideal profile of person. Once you establish the responsiveness of this, you can then use retargeting to reach a wider audience and control your spend. You can also recruit through your existing network – they will inevitably know people with a similar profile to themselves, so you can offer a low-level incentive to them to help you in your recruitment.
Kendall Braddock: Recruitment in the early days of franchising is always challenging. Quite often I see franchisors reducing the franchise fee to encourage recruitment on the understanding that the franchisee understands that they are expected to contribute to the improvement of the franchise model in those early months. This will need to be properly documented within the agreement, but is something to consider. Also, I’ve seen franchisors encourage existing franchisees to refer a friend which ensures the quality of franchisee is maintained (they are unlikely to recommend someone who they don’t think would be able to succeed).
Q: How do we further build our brand that further benefits the Franchise?
Louise Young: Ensure consistency of the communication of your brand across your network. Make sure all promotion is on brand and that your franchisees handle enquiries swiftly and professionally. Encourage your network to claim and update their Google My Business page for their location and provide consistent imagery and wording across all promotional materials. Raise your profile using PR opportunities and harness the value (and potential reach) of video comms as much as possible.
Q: What are your best tips for converting more leads into Franchisees?
Sean McKeon: Engagement – keeping in contact with candidates in a dynamic fashion that allows them to stay interested in your opportunity until the time is right for them. Consider what kind of CRM you use and automated contact (emails) with leads that are not immediately ready to take the next step. Put simply, you are looking to increase the shelf life of the leads that you generate.
Louise Young: A CRM system can help automate the process for you and ensure you spend your time on your most valuable leads as well as helping you to track the communication content and medium that offers the greatest traction with your target audience. Research your successful franchisees to establish the drivers for them in taking on your franchise – this could provide valuable insight into how to reach similar people. Use success stories in your communication and gradually refine who you are targeting to ensure the best ROI of your recruitment spend.
*For more information on the Franchise Awards, click here.